City Manager's Office and Department of Finance
Reference: 2026 tax and licensing code updates
To: Mayor Gregory Mills and Members of City Council
Through: Michael P. Martinez, City Manager
Prepared By: Ana LeScoezec, Revenue Manager
Date Prepared: October 14, 2025
PURPOSE
To provide City Council with recommended updates to the tax and licensing code that will ensure consistency and allow for more flexibility to better service the business community.
BACKGROUND
Since 2020 business licenses have been issued by the City's Finance Department and also serve as the business sales tax account under which the business files and pays sales tax owed to the City. The licensing process involves review and approval by various departments depending on the type of business. Businesses such as remote online sellers who are not required to have a license maintain a sales tax account with the City under which they file and pay sales tax.
The tax and licensing code is reviewed periodically to ensure consistency with current practices, rules and regulations as well as improving the process for businesses.
House Bill 24-1371 added requirements for massage facilities requiring local governments to regulate these massage businesses. The State Legislature made it a matter of statewide concern that all owners and employees of massage facilities submit to a fingerprint-based criminal history record check. One stated purpose of the bill is to have all jurisdictions work to combat human trafficking.
PROPOSED SALES TAX AND TELEPHONE TAX CODE UPDATES
Clarify conflicting code sections regarding excess tax collection
Excess tax refers to sales tax collected in excess of the applicable combined rate, or total rate, including State, County, City and any other applicable sales tax. This can occur for various reasons including errors in the business's point of sale system or simply rounding.
The current tax code has two conflicting code sections regarding what a business should do...
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